Businesses must do a lot of research prior to downsizing.
As a result of dwindling sales and increasing production costs, many large companies have used downsizing as a tool to keep profitability high. The practice has been vilified because the public, at large, views it as a "knee-jerk reaction to either internal or external pressures," according to a study by Fisher and White. In 2001, dozens of Fortune 500 companies reported a total loss of 1,040,466 jobs.
Boeing Company
Boeing is a huge multinational corporation that designs and builds military and commercial aircraft. In 2001, due to already lagging commercial jet sales and then the airliner-driven carnage on September 11th, Boeing cut over 20,000 jobs across the spectrum of the company, from office staff to factory workers.
Sear Roebuck & Company
Sears is a decades old chain of stores that offers a variety of products to consumers, from clothing to lawn equipment. Due to low sales, in 2001, Sears cut 4,900 jobs in a huge restructuring that closed 89 stores and a number of other smaller businesses. Conversely, they announced the opening of two new plants in locations where demand was rising. As a result of the downsizing and the new initiatives, Sear's stock rose 30 percent in three months.
Xerox
Xerox is a company that designs and develops office printers and copiers. In 2001, the company shed over 4,000 jobs from all employment levels. They had been restructuring the company for the last 10 years in 2001, and the downsizing began with voluntary severances before escalating to firings.
VF Corporation
Clothing giant, VF Corporation, distributes brand name apparel worldwide to over 47,000 retailers. In 2001, they cut 13,000 jobs in a huge downsizing. The company sold off or shut down three of its brands and closed more than 30 U.S. plants. This constituted about 18 percent of their workforce, and many of these lost jobs were shifted to Mexico, Central America and the Far East.
Hewlett Packard
Hewlett Packard is a large computer hardware and software producer. In 2001, they cut 3,000 jobs as they were switching some of their focus from hardware to service. That same year, they announced a merger with Compaq Computer Corporation.
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